Buying a Home in Spain
Spain is among the world's most attractive places in which
to buy a second home; countless foreign homebuyers have been
attracted to Spain's sunny beaches and fun-loving culture. Spain
also offers a unique combination of favorable economic conditions,
an excellent climate and superb quality of life. Although the
country is just coming off a massive, decade-long real estate
boom and perhaps can't offer the same lucrative returns on investments
that were once possible, the property market still offers good
potential for investment-minded buyers as well.
One of the positive aspects of the real estate slowdown is
the lowered demand that puts buyers in a more equitable position
when searching for property. As recently as last year, sellers
faced with nonstop demand had the definite upper hand in the
buying process.
Another benefit for foreigners interested in buying a vacation
home in Spain is recent legislation that decreases the capital
gains tax to be paid by foreigners who own a home in the country.
The rate was significantly reduced from 35 to 18 percent,
the regular rate for Spanish residents.
Although buying a new home can certainly be exciting and
fun, there are also a number of mundane tasks that have to
get done in order to make the purchase as smooth and problem-free
as possible. This is especially true in Spain, where paperwork
and bureaucratic entanglements can lengthen the buying process
considerably.
The fun part of looking for a home is the initial phase:
looking at a map and considering what the most attractive
region is, reading and asking around about different places,
making a few visits to get the feel for the culture and quality
of life in a particular area and, finally, checking out different
homes and fantasizing about what your new life there will
be like. If you've already been in Spain, you know that simply
spending time here is a pleasant experience.
Although this part of the experience can be fun, it can also
be time-consuming. Finding a reputable estate agent that'll
do research on your behalf, although more costly than looking
on your own, can help make the process quicker and easier.
Keep in mind, however, that strict requirements to becoming
an agent in Spain don't exist; it's somewhat common for individuals
with limited resources and a scant understanding of the workings
of the real estate market in Spain to set up a small operation
and promise a better service than what they can actually deliver.
Having said this, there are plenty of professional agencies
that offer exceptional service – you simply have to
exercise a bit of discernment when choosing one. Asking around
about the experience of friends and acquaintances who've bought
property in Spain is also a good idea in this regard.
The internet is also becoming a good place to start the search
for your dream home in Spain. While Spanish real estate doesn't
have a particularly strong presence on the web yet, the Spanish
property portal, offering free services such
as property searches, news on the real estate industry in
Spain and informative guides to foreigners interested in buying
a second home in Spain is becoming increasingly common and
easier to find.
The mundane part of the process comes in once you've finally
set your heart on a home. Here, you'll be faced with responsibilities
like getting pre-approved for a mortgage, obtaining necessary
documents, dealing with 'unofficial' money exchanges that
are still common practice in Spain, considering the tax benefits
of changing your fiscal address if you'll be living in Spain
for an extended period and hiring professionals to inspect
your house. Many estate agents offer services that take care
of some of these processes but it can always be recommended
to seek proper legal advice.
Buying Off Plan Property
Another game altogether is to consider buying an off plan
property. This means you'll invest and commit to buying a
particular property before it's actually constructed. Committing
to an off-plan property usually involves paying 10% of the
future home's price, with the rest being paid once the property
is constructed.
Basically, if you're buying off-plan you'll be presented
with a brochure and detailed information on the development
to be built. The company in charge of the project normally
waits until a certain number of investors have committed to
the project before beginning actual construction, but you'll
know approximately when your home will be completed.
There are sites that offer services like free background
reports and legal information on off-plan
properties in Spain as well as searchable off-plan
projects throughout Spain.
The obvious downside to buying off-plan is the possibility
of ending up with something other than what you were promised.
This problem can be avoided if you do enough research and
are careful about the company project and the company you
decide to invest in. The major benefit is that you can save
a considerable amount of money. If you do enough research
and choose a project carefully, you can end up with a home
you like in a nice area at a great price.
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